New Group Emerges to Buy Stock Supply Locations

November 4, 2009

BlackEagle Partners LLC, a private equity firm focused on turnarounds and special situations, and Building Industry Partners LLC, a private equity firm focused on the U.S. building products industry, have joined with L.T. Gibson to form US LBM Holdings LLC to acquire three regional operations from Stock Building Supply LLC. 

The new firm is buying pro dealer operations serving Wisconsin, Central New York and Connecticut that were all longstanding, previously independent businesses with #1 or #2 market share supported by strong local management, it reports. Under US LBM, the operations will be re-established as local autonomous businesses under their former or independent trade names, Wisconsin Building Supply, Bellevue Builders Supply and East Haven Builders Supply, respectively.

In aggregate, US LBM and its subsidiaries will be comprised of 13 locations and more than 500 associates servicing the professional building market with a primary focus on customers that require specialized services, such as custom homebuilders, professional remodelers as well as multifamily and commercial contractors.

“Operating as an independent company again allows us many of the freedoms to improve services to our customers. A customer can walk in and talk to the people that make the decisions. We feel that’s important,” says Gibson, US LBM’s president and CEO. “We found a great partner with BlackEagle. They have repeatedly shown a commitment to the success of our business in addition to providing the strategic resources that adds value to our organization in this difficult environment.”

“We are excited to partner with L.T. and his team of industry veterans in the acquisition of three leading building product distributors,” says Jason Runco, Partner of BlackEagle. “By focusing on smaller markets, the company has a more diverse customer base with less national competition serving both new residential builders as well as professional remodelers.”

“US LBM will serve as a platform in the industry as we seek to invest in or acquire complementary businesses to expand the company’s geography and product breadth,” adds Harry Watson, another BlackEagle partner. 

The plan is to make acquisitions in the pro dealer space, often in partnership with current ownership and management, that enables the businesses to operate as autonomous local divisions with the capital and other resources of a much larger national organization. “US LBM will continue to look for outstanding private pro dealer businesses and management teams that are seeking an equity capital partner to bolster working capital, support organic and acquisition-related growth initiatives and be in position to prosper coming out of the current U.S. residential construction downturn,” says Matt Ogden, managing principal of Building Industry Partners.